Tuesday, December 07, 2010

Debt, dominance and stability

The United States finds itself constrained by debt and losing leverage on the world stage. Secretary of State, Hillary Clinton, concedes this "sends a message of weakness internationally."

Richard Haass, president of the Council on Foreign Relations, believes this is bad for America and bad for the world. According to Haass, the diminution of US dominance over the world system will herald "an era of international relations in which things get a lot messier."

Clearly, Clinton and Haass subscribe to the establishment consensus, that the United States has been a benign hegemon, indefatigably "promoting prosperity and stability around the world", by being able to "lead and act in the ways it has ... since World War II."

These "ways" include flagrant disregard and explicit contempt for international law, unprovoked aggression and war crimes, covert and overt interventions abroad, massive corporate fraud and a host of horrendous atrocities around the world.

If there were any truth to the claims made by the Anglo-American establishment and their Western vassals, promoting and endorsing US dominance of the world system, would there be any need for multi-trillion dollar war spending? Would there be millions starving in Africa while millions suffer obesity in the West?

Has fifty years of western military intervention around the world made the place safer or more stable, is there any evidence that the trillions spent on war have served to enhance security and prosperity for more than a super-rich clique?

It requires a peculiar US-centric perspective on the world and blind faith in the efficacy of force to believe that US dominance of the world system is good for America and good for the world.

A more balanced and realistic view of the world permits the possibility that US interventionist policies and disregard for international norms actually provoke hostility, promote conflict, undermine the rule of law and foster global instability.

The United States' fiscal deficit is not its only deficit - of equal significance is its deficit in trust and credibility. The decline in the value of the US dollar is concomitant with a decrease in the standing of the US on the world stage. As the US is progressively reduced in wealth and standing, it will be subjected to ever-greater pressure to conform to international norms.

The loss of American "exceptionalism" will curb the United States' predilection for unilateral intervention in other nations' affairs. Fiscal constraints will be compounded by political and military constraints. Unsustainable war spending will have its day of reckoning.

The dissolution or fragmentation of the unipolar world system will hasten the "emergence of a polycentric international system", a more equitable and representative balance of powers on the world stage. This might seem like a frightening prospect for the failing superpower, but for the rest of the world, it offers promising possibilities.

The global economic downturn has severely hurt the American economy. This, together with the military reverses in Iraq and Afghanistan, show America’s dwindling authority in controlling the once US-dominated world order. The biggest casualty, however, has been America’s image of invincibility. China, in contrast, has shown remarkable resilience economically, increasing its global influence tremendously. This has raised legitimate questions about who is going to lead the globalisation process in future and how will it affect the shaping of the global order.

The United States always justified its primary position in the globalisation process due to its strong economy and armed superiority. Now, employing the same logic, the Chinese have started staking their claim for a greater leadership role in global financial institutions. The recent G20 summit in Seoul, besides showcasing growing Chinese strength, proves that the US and its allies are capable of neither unilaterally deciding the outcome of any major global summit nor imposing their interests on other state actors.

Further, many of America’s former allies are being seen as supporting the Chinese stand on several financial issues. This is indeed a silent but defining shift in the global order. Global capitalism, therefore, is no longer being led by the Unites States alone; rather, it is equally being taken forward by emerging economies like China and India.